South Korea prepares to overturn ICO ban

Newly elected South Korean President Yoon Suk-yeol has announced the initial approval of ICO’s as part of the new government’s aim to bring cryptocurrency out of the dark.

The Digital Asset Framework Act aims to manage the issuance and listing of digital tokens and prevention of unfair trade acts, according to the presidential transition committee. 

Yoon Suk-yeol used crypto deregulation as one of his campaign promises, starting with the end of the ICO ban from 2017. Yoon’s administration has outlined a plan to establish legislation via a Digital Asset Framework Act which will contain guidelines on digital assets including NFTs.

The Presidential transaction committee included the Digital Asset Framework Act as part of the government's “110 tasks” which is a list of the top priorities that the government will be tackling in the new presidency.

A transaction committee member noted:

“We will prepare conditions for users to safely invest, such as introducing an insurance system against hacking and system errors and recovering profits from unfair transactions.”

South Korea’s approval of initial coin offerings will take the form of a two-lane regulatory framework for ICOs in which digital assets are classified as securities and non-securities.

South Korea’s Financial Services Commission (FSC) banned ICO’s in 2017, citing risks associated with this type of fundraising. At the time the regulator noted “raising funds through ICOs seem to be on the rise globally, and our assessment is that ICOs are increasing in South Korea as well”.

According to reports by local outlets, a crypto assets tax will be discussed after investor protection-focused legislation is in place.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.